The Moroccan Company of Tobacco (SMT) has agreed to support government's decision to increase the domestic consumption tax on cigarettes.
Rabat – After the 2019 Finance Bill stipulated an increase in the domestic consumption tax on certain cigarette brands, the SMT said it assented the state move.
On Wednesday, daily newspaper Aujourd’hui le Maroc quoted company officials as saying: “The SMT fully adheres to the administration’s desire to improve tax revenues, through a relevant and studied reform of provisions relating to the domestic consumption tax related to this product.”
The tobacco companies in Morocco reportedly doubted the seriousness of the 2019 Finance Bill analysis, which, according to them, will aid in creating a market for the smuggled tobacco.
The SMT officials emphasized the importance of protecting the country’s producers in developing the tax system, similar to many countries around the world.
The tax increase will affect the most widely-consumed cigarettes on the market: Marlboro and Marquise. Marlboro packs will be sold for MAD 40 instead of MAD 33, and Marquise for MAD 21 instead of MAD 19.
According to Article 5 of the 2019 Finance Bill, the minimum tax rate will increase from MAD 567 to MAD 630 per 1,000 cigarettes, while the minimum tax burden will increase from 53.6 percent to 58 percent.
Morocco received MAD 10.48 billion from the domestic consumption tax in 2017, up from MAD 9.86 billion in 2016, according to customs administration.
In October, Minister of Economy Mohamed Benchaaboun stated that the bill’s increase of taxes on tobacco consumption will generate additional revenue, estimated at MAD 1.2 billion in 2019.
The 2019 Finance Bill also included raising domestic consumption taxes on shisha tobacco from MAD 350 to MAD 450 per kilogram.
On November 11, the finance committee voted on the first part of the 2019 finance draft bill by adopting 56 amendments, including raising domestic consumption taxes by 50 percent on soft and non-carbonated drinks with high sugar levels.